It is said that in India, the tea plant was discovered in Assam by a Scottish trader named Robert Bruce. Although Mr Bruce is credited with this feat, the Singpho tribesman of northeast India were already adept at the art of processing and enjoying the brew by then.
But the first tea plantations were established in India by the mid-1830s and the first tea company set up then—called the Assam Tea Company—is still in operation today.
In due course, tea estates began to flourish across Assam, along either bank of the Brahmaputra river. Most were owned by European agencies and the bulk of produce found its way to European markets. The Assam variety of tea is called CTC, a term derived from its method of production involving ‘crush, tear and curl’.
Tea was also planted in the Darjeeling hills in the 1840s, the initial efforts being credited to Archibald Campbell, a British civil servant. The Darjeeling variety is called the orthodox kind, since it follows the traditional style of manufacturing – the leaves are not crushed or torn; rather they are delicately rolled while maintaining the wholeness of the leaf. A tea connoisseur will usually opt for the orthodox kind.
Other prominent tea-growing areas in India are the Dooars and Terai regions of West Bengal and the hill tracts of South India.
Tea and the economy
The tea industry in India has contributed substantially to the local (and national) economy since its early days. In Assam in particular, the tea industry has been a mainstay since India’s independence. In fact, a large number of European tea planters continued to be employed in the industry up until even the mid-1980s.
Although most estates were located in remote areas, they offered a plush lifestyle for managerial staff, and a range of benefits. Staff were provided sprawling bungalows with a retinue of in-house support staff. In addition, each cluster of tea plantations enjoyed access to a clubhouse and golf course, among other amenities. This was central to social life in an otherwise isolated setting, and meant that managerial jobs in the tea industry were associated with a great degree of prestige.
The tea industry is also a large-scale employer, with each estate needing a workforce of about 1,500to 2,000. They were central to the local economy in several parts of India, with settlements coming up around tea plantations. In many ways, they have been nerve centres of economic activity.
For the most part, tea planters enjoyed heady years, until disruption came along, mostly beginning at the turn of the millennium. Disruption went hand in hand with what some refer to as a lackadaisical approach.
The (unpleasant) winds of change
By 2000, Indian tea exports started coming under stiff competition from cheaper Kenyan and Chinese teas. Around the same time, a new trend of establishing standalone or ‘bought-leaf’ tea manufacturing units emerged, both in Assam and in West Bengal. This second aspect was a major disrupting force, one that has forever changed the fortunes of traditional tea estates.
Why was this a pivotal moment?
Tea laws mandate the provision of several benefits to tea workers. These include rations, footwear, healthcare coverage and primary education, among others – definite fair practices that the government has enforced. Standalone manufacturing units, however, were able to circumvent these requirements by employing labour on a contract basis.
As for green leaf sources, numerous farmers with small plots of land found it economically more lucrative to cultivate tea as opposed to growing other cash crops. And it is easy to understand why farmers made the switch. Once planted, a tea sapling takes about three to four years to mature and it then begins yielding the signature ‘two leaves a bud’ that is used for tea production. Unlike paddy or wheat, the plant does not require uprooting and replanting each season. In fact, it has a productive lifespan of about 80 years. Standalone units came up primarily in these areas where green leaf was easily available.
In the years ahead, the tea plantations of old will have to embrace technology to stay competitive. Innovative farming techniques will also have to be explored.
With substantially lower overhead costs, bought-leaf production units were able to offer finished teas at much lower costs. Traditional tea estates, on the other hand, were unable to compete for the most part given their higher input costs. Many such estates that had established clientele were able to continue commanding higher prices, but they largely struggled. Several tea estates are also brands in themselves with their teas enjoying worldwide acclaim. A case in point is Makaibari – a celebrated and storied plantation in the Darjeeling hills. (Sidenote: when Indian Prime Minister Narendra Modi called on Queen Elizabeth in 2015, Makaibari tea was among the state gifts).
The odds have stacked
Bought-leaf tea factories also resulted in stagnant tea prices. For over a decade, tea prices barely moved north. During the same time, however, labour wages increased substantially. Meanwhile, the large workforces are looked upon as sizeable vote banks by political parties. Politically affiliated labour unions, particularly in West Bengal, have been responsible for repeated strikes and conflict with management. In fact, Darjeeling plantations were witness to prolonged periods of unrest beginning as early as the 1960s. Assam has witnessed its fair share too, but more from extremist organisations that often indulged in kidnappings of tea garden management. They demanded heavy ransoms, to the extent that several tea companies came together to form their own defence militia of sorts in the mid-1990s, called the Assam Tea Plantation Security Force.
In simple terms, these were all expenses that overburdened legacy tea companies. As a consequence, many old companies went out of business, or chose to. This was, however, the lesser of the negative outcomes. Many estates on sale did not even find takers – and as a result, these were simply abandoned abruptly, putting thousands out of work.
In certain pockets, these closures resulted in a rise in crime as desperate workers fought for survival. Even Makaibari, which often sold its teas for prices as high as $300 per kilogram, saw a change in ownership. The Banerjee family—which owned and operated the estate since 1859—sold the estate to the Luxmi Group in 2014. This was a surprise move for an estate that seemed to be doing well enough.
A better future?
Ironically, the Indian tea industry was delivered a breather in 2020 with the pandemic-led lockdowns. While COVID-19 was a bane for most industries, it was a shot in the arm for Indian tea. A substantial demand-supply gap led to a sizeable price increase. It allowed tea industry stakeholders to offset years of stagnant growth while also enabling payment of past dues that were owed to workers. But the relief was short-lived, as by the end of 2020, prices were once again at regular levels.
By 2000, Indian tea exports started coming under stiff competition from cheaper Kenyan and Chinese teas. Around the same time, a new trend of establishing standalone or ‘bought-leaf’ tea manufacturing units emerged, both in Assam and in West Bengal.
In the years ahead, the tea plantations of old will have to embrace technology to stay competitive. India’s large rural to urban migration is also impacting the country’s tea industry. Many rural workers in the current generation have been able to access higher education. Consequently, they are seeking employment opportunities outside of the plantations and often moving to bigger towns and cities for more traditional jobs.
And separately, with renewed minimum wage legislation likely to be enacted soon, the permanent workforce sizes in tea plantations could witness large reductions. Activities such as tea plucking and processing will therefore need to transition from manual to mechanised modes.
Innovative farming techniques will also have to be explored, including growing more profitable cash crops alongside tea. A case in point is Tata Tea’s plantations in Assam, which have long grown pepper along with tea.
Just as legacy organisations across industries are adapting in the face of disruption, so must the long-antiquated Indian tea industry. A failure to do so will set the industry up for an untimely demise, and threaten millions of livelihoods in the process.